Native monetization is deriving revenue from a platform in a way that is unique and organic to the experience. It’s the reason why Twitter, Facebook, Foursquare, Stumbleupon, Tumblr, and BuzzFeed avoid just slapping banners anywhere they can fit them.
It's taking the core organic activities and extrapolating them to a paid activity that "fits."
A post I did a while back: http://jonsteinberg.com/2011/03/07/native-monetization/

What are the key features of a Native Monetization advertising program or system?

Native monetization is deriving revenue from a platform in a way that is unique and organic to the experience. It’s the reason why Twitter, Facebook, Foursquare, Stumbleupon, Tumblr, and BuzzFeed avoid just slapping banners anywhere they can fit them.

It's taking the core organic activities and extrapolating them to a paid activity that "fits."

It's interesting to see Facebook discuss how vital content and "stories" are to social advertising. In some ways the necessity for stories and content in social, if anything, has been understated. To be social (tweet, tumblr, facebook, stumble), all the channels need to drive to great shareable content. I think brands recognize this, and we're seeing a huge content focus across the board.

The concept of native is the next evolution of the concept behind soap operas: producing original content for the sake of entertaining its viewers, but also to showcase brands/products.The biggest challenge with soap operas was that they were expensive to produce & distribute, which is solved in the social world.When you can blend content with creativity, the bounds are endless.

Recently pulled together some slides around this topic: slideshare.net

I love native advertising opportunities. They are unique, contextual and resonate well with the audiences. The problem with them are that they don't scale well...at all. In order to pull off 10 different tactics, you need 10 different production budgets (theoretically). For agencies and client budgets, this is a huge headache. Today. Tomorrow, this will get figured out.

The content gets repurposed across all these native channels.And I think over time there will be inter-operability.We already do this via the Facebook Ads API and I could imagine us integrating more tightly with Stumble etc. Create content once- APIs solve for scalability

We're working on building an API at Stumble for that exact reason.It's all the same content, just repurposed for its native format.For SU, it's a web page; for Facebook, it's a post generated from interacting with that web page; for Buzzfeed it's taking the assets and repurposing into a story...and so on.

But I believe that's wrong under the context of native. Take for example Solve Media- it's native monetization but what they are offering advertisers in the form of content will not work on Tumblr, or Buzzfeed. Buzzfeed content will not work on the BBC. Native monetization is native to the individual platforms.

Nice conversation everyone.Great points.I'm going to be a bit lazy here and cheat a bit by copying a link to my article yesterday from AdAge.

You can ignore the headline, The guts come after the social platforms I name.My basic argument is for the first time brands can buy audiences and then pay to distribute to them.This is a big shift and really turns the industry on it's head.There are a lot of ramifications and most aren't readily apparent....Yet.

They've been paying for the right to interrupt an audience that they rent.I believe James is suggesting that today's platforms enable you to actually develop your own audience instead of distracting someone else's.

Creating algorithmic ways to scale native advertising opportunities is a big challenge / big opportunity.It won't be as easy as simply repurposing content (as you point out Darren, the native opps aren't the same across different platforms, communities and experiences), but will take a "context algorithm" to understand how the content applies to the unique experiences and actions that drive how a platform's community works.Community context more important than content repurposing.

Love this conversation. I wrote out my framework for native monetization for this thread, but turns out it's about 3000 characters too long for this little box here....Here's a snippet below, but my full "native monetization" definition is here: